Bouncing off major support | 04 November 2013

EUR/USD has made a temporary low at support. It has bounced and could continue higher, possibly all the way up to 1.3600. There is a possibility of a sideways consolidation now forming – or at the very least a pause in the strong short-term down-trend. All the down-targets on the point and figure chart have been reached adding to the view of exhaustion. The break of the 1.3465 lows was a major reversal sign indicating a stronger bear current could be developing and, whilst a bounce is possible in the short-term, the bear trend is expected to resume once the immediate environment ends, with a move down to the 1.3050 level expected, signalled by a break below 1.3425. The euro is particularly sensitive to poor economic data and it could be the catalyst to more strong down-moves.